Why is nobody talking about the current shakedown in the Philippine stock market?
I’ve searched online and nobody seems to express any concern that in a span of almost two (2) months from the time the new administration took over, it has managed to essentially shut down* Philweb Corp. (stock ticker: WEB), a publicly-listed, small cap (considered small at a market capitalization of about PhP 9 billion).
*Philweb’s sole business involves operating e-games stations upon the authority of a license from PAGCOR (Philippine Amusement and Gaming Corporation). Philweb’s license expired on 10 August. PAGCOR denied Philweb’s application to renew it.
**With no license, Philweb is unable to continue doing business. It is now winding up operations. However, to date, the company still denies that it has closed down.
Similar timeline to SCC
I am pretty concerned because Philweb’s downward timeline is becoming eerily similar to SCC / Semirara Mining Corporation’s current situation.
Of course, SCC and WEB are different in many ways. SCC is a big cap company valued at PhP 160 billion. Its business isn’t limited to coal mining, it is also in the coal power generation business. However, should it permanently lose its ECC and the consequent ability to do mining activities, its profits might dive because its power gen business gets coal from itself.
Simply put, SCC supplies itself. It is its own coal market.
The investing public is affected
How are you affected? WEB has a public float (percentage of stocks sold to the public on the stock market as opposed to a private sale, inaccessible to you and me) of 24.78%. This means that 24.78% of WEB shares are held by the investing public, like you and me (caveat: I personally do not own any WEB shares).
On the other hand, SCC has a public float of 26.94%. I own some shares in SCC. My holding is small as it represents 10% of my total stock portfolio.
We, as the investing public, are therefore directly affected by these recent and alarming events.
Buyer’s expectations of the market largely affect the stock price of these companies. So for now, I choose to keep calm, and wait for further developments. While tempted to buy more, I’ve halted any further purchase of SCC.
How do you feel about these recent events? Do you have mining stocks in your portfolio?
20 something lawyer